Danse macabre - by Richard... Friday, October 22, 2010

Danse macabre - by Richard... Friday, October 22, 2010

Well, the Daily Mail is on the case, telling us that Boy Dave and his ghastly sidekick Clegg, "felt the full force of public anger over huge increases in the international aid budget - as it emerged the move will cost every family in Britain almost £500 a year."

Call me Dave was "forced on to the defensive over the controversial decision to lavish billions of pounds of taxpayers' money on foreign aid at a time when services at home are facing unprecedented cuts." A member of the public confronted him over the issue at a public meeting in Nottingham yesterday, telling him: "Charity should begin at home."

Certainly, she ain't far wrong, but forgot to point out to this dire pair that they are serious, decidedly and absolutely barking mad ... so far off their trolley, the damn thing is still iron ore in the ground. They have totally and completely lost it.

Think of all the heart-searching on the carriers and the Navy cuts and these f***wits are giving £2.9 billion to international climate finance "to help developing countries pursue low carbon growth and adapt to the impact of climate change," and then increasing the already over-generous foreign aid by £3.7 billion.

Meanwhile (pictured) Clegg is giving dancing lessons to earn a spare bob or two – the only useful thing he will do this year. One would like to think he has assumed the position to relieve the pain from having his own brains shoved up his backside – although they are small he would hardly notice, I suppose.

COMMENT: CUTS THREAD

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Dem cuts - by Richard...

According to a TPA briefing, "one reason why cuts are needed is that debt interest payments are set to rise substantially in the coming years."

The total cost of servicing debt interest, plus unfunded pensions and PFI will be even greater, as shown by the graph (produced by former Treasury and City economist Mike Denham).

By my reckoning, between this financial year and 2014-15, these liabilities increase by about £60bn. By then, however, the Cleggerons are only increasing annual public expenditure by £43bn – giving a deficit of £17bn on that year.

However, it seems that the cumulative shortfall over the period is about £130bn, whereas the cumulative increase in expenditure is about £90bn. That leaves a £40bn deficit, plus whatever departmental increases are given, such as to DFID and DECC - bringing the total deficit to about £50bn - which must be cut from the other departments in order to make the books balance.

In terms of the departmental increases, one item we are looking at is the £2.9 billion to DECC for international climate finance "to help developing countries pursue low carbon growth and adapt to the impact of climate change." Under the current regime, the only way this can be afforded is to claw it from the health, defence and other departmental budgets.

The same applies to the £3.7 increase to DFID for foreign aid – assisting the Indians to develop their space programme – which will also have to be clawed from health, defence, etc. That's £6.6bn which has to be withheld from hospitals, schools, police, roads, etc., etc.

Thus, as it stands, the premise that there are no expenditure cuts survives. Year-on-year, public expenditure increases. So what we have is a re-ordering of the budget to fund debt, pensions and the increases in the DECC and DFID budgets, amongst others. In effect, services are being cut because total public spending is not being increased to fund current service levels, the increases in current liabilities and Cleggeron spending priorities.

What this amounts to, therefore, is that we are going to have to pay more to get considerably less, as services get cut to make the books balance. But don't anyone pretend that overall expenditure is being cut. It isn't. Jeff Randall agrees, but you read it here first.